RAJARATNE v. AIR LANKA LTD. AND OTHERS

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128
Sri Lanka Law Reports
[1987] 2 SnL.R.
RAJARATNE
v.
AIR LANKA LTD. AND OTHERS
SUPREME COURT.
ATUKORALE, J.. SENEVIRATNE, J. AND H. A. G. DE SILVA, J.
S.C. APPLICATION No. 63/86.
SEPTEMBER 16. 19 AND OCTOBER 1.2. 3 AND 20. 1986
Fundamental Rights-Articles 12(1).17 and 126 of the : o-if ? on-
Equality-Discrimination
(Held -Seneviratne, J. dissenting):
Although the petitioner was better qualified and more eligible for appointment as aFlight Engineer than one Wijesinghe the iatter was appointed tc the post Thisamounted to discrimination
The written test set for the petitioner was intended to belittle the petitioner'squalifications while the written test set for Wijesinghe was one tailor-made to suit hisspecial aptitudes. This amounted to differential treatment and a denial of equality ofopportunity.
Air Lanka being brought into existence for carrying out a function of great publicimportance once carried our by the government through a statutory corporation,financed almost wholly by the government and managed and controlled by thegovernmem through its own nominee Directors is an agency or instrumentality of thegovernment. In reality Air Lanka is a company formed by the government, owned by thegovernment and controlled by the government. The juristic veil of corporate personalitydonned by the company for certain purposes cannot, for the purposes of the applicationand .enforcement of fundamental rights enshrined in the Constitution, be permitted toconceal the reality behind it which is the government. The brooding presence of thegovernment behind the operations of the company is quite manifest. The cumulativeeffect of the factors and features is to render Air Lanka an agent or organ of thegovernment. Its action can therefore be properly designated as executive oradminstrative action within the meaning of Articles 1 7 and 126 of the Constitution. Thepetitioner has established that he is entitled to relief under Article 126(4).
Cases referred to:
Perera v. University Grants Commission-(1980) Vol. 1 FRO 103.
Wijetunga v. Insurance Corporation of Sri Lanka-] 1982] 1 Sri LRI.
Wijeratne v. The'People's Bank-[1984] 1 Sri LR I.
Ramana Dayaram Shetty v. International Airport Authority of India-AIR 1979 SC1682.
129
SCRajaratne v. Air Lanka Ltd
Ariyapala Guneratne v. The People's Bank-[1986) 1 Sri LB 338.
Roberts v. Ratnayake-[1986] 2 Sri LR 36.
Rajasthan State Electricity Board, Jaipur v. Mohanlal- AIR 1967 SC 1857
Sukhdev Singh v Bhagatram-AIR 1975 SC 1331
AjayHasiav. KhalidMujubSchravardi-AIR 1981 SC 487.
Som Prakash Rekhi v. Union of India -AIR 1981 SC 212.
Sabhajit Tewari v. Union of India-AIR 1975 SC 1329.
Praga Tools Corporation v. C. V. Immanual-AIR 1969 SC 1306
Chandrasena and Two Others v National Paper Corporation-[ 1982] 1 Sri LR 19.
Kerr v. Enoch Pratt Free Library-(1945) 326 U.S. 721.
Marsh v. Alabama-(1946) U.S. 501
Heavy Engineering Mazdoor Union v. State of Bihar-AIR 1970 SC 82.
Gamini Samarasmghe v Bank of Ceylon and Another-(1980) Vol. 1 FRD 165.
Gunasena Thenabadu v University of Colombo and Others-(1979) Vol. 1 FRD63
APPLICATION for infringement of Fundamental Rights.
R. K. W. Goonesekera with S. Nandadeva for the petitioner.
H. L. de Silva, P.C. with S. L. Gunasekera for 1,2 and 3 respondents
Cur. adv. vult
April 3. 1987.
ATUKORALE, J.
The petitioner was enrolled as a student in the Flight Engineer'sDepartment, Institute of Technology, Northrop University in California,U.S.A. a premier institution providing aeronautical services approvedby the Federal Aviation Agency., U.S.A.. He successfully completedthe curriculum for the Boeing 727 Flight Engineer, Turbojet Rating, atthe said University and was, in September 1983, awarded acertificate to this effect -P2. He was certified by the Federal AviationAdministration as having been found to be properly qualified toexercise the privileges of a Flight Engineer for Turbojet Powered(Boeing 727) aircraft -P4. In March 1984 he applied for and obtaineda Flight Engineer's licence from the Department of Civil Aviation, SriLanka, with a Boeing 727 rating -P5. In February and again in March ofthe same year he applied to the 1st respondent (Air LankaLtd. hereinafter referred to as Air Lanka) for the position of a FlightEngineer-R9 and R10 respectively. He was interviewed but since atthat time Air Lanka was concentrating on recruiting Second Officers
130Sri Lanka Law Reports[1987] 2 SriL.R.
rather than Engineers, it was decided to review his application with thenext batch of recruits. This is so expressly stated by the 2ndrespondent-the Chairman and Managing Director of Air Lanka-in hisletter, P11, of 28.03.1986. Then in September 1985 he re-appliedfor the same position. He was requested to be present for a writtentechnical test. When he presented himself for the test, he found thathe had been subjected to the same Cadet Pilot's examination as theother candidates, all of whom had applied for the post of Cadet Pilotand not Flight Engineer. He protested. He was then re-summoned tosit for a written technical test for the post of Flight Engineer which wascompiled by the 3rd respondent, the Chief Flight Engineer of AirLanka. He sat for this test on 13.1.1986. According to him, hereceived no official intimation of the results in consequence of whichhe wrote letter P10 dated 10.3.1986 to the 2nd respondentcomplaining, inter alia, of the unfairness of the examination that hadbeen set by the 3rd respondent. The 2nd respondent by his letter P11aforementioned replied that the petitioner had fared poorly at bothexaminations and that Air Lanka could not offer him employment.
In his application to this court he complains that he has beensubjected to unequal treatment in breach of the fundamental rightguaranteed by Article 12(1) of the Constitution and invokes thejurisdiction of this court under Article 126(1) thereof on the basis thatsuch infringement was by virtue of executive or administrative action.The relief he claims is an award of damages in a sum of Rs.
000,000/- (One Million) for failure to recruit him in 1984 and/or1986.
The petitioner's complaint of unjust discrimination, as presented tous at the hearing, revolves on the appointment of one ArunaWijesinghe to the post of a Cadet Flight Engineer in Air Lanka inAugust 1984. It is founded on the allegation that different standardsor different criteria have been adopted by Air Lanka in respect ofhimself and Wijesinghe in regard to recruitment for the same post,namely, that of Cadet Flight Engineer in Air Lanka. The particularsfurnished by Wijesinghe. in his application (Y) dated 10.7.1984(which, incidentally, also is titled as being for the post of FlightEngineer) shows that he had been employed at Air Lanka since
5.1980 as an Apprentice Aircraft Maintenance Engineer. He had,inter alia, successfully completed all the basic courses for ApprenticeAircraft Maintenance Engineers conducted by Singapore Airlines, allrelevant Department of Civil Aviation (Singapore) basic papers for
SCRajaratnev. Air Lanka Ltd. {Atukorale, J.)131
Licensed Aircraft Maintenance Engineers (Airframe and EngineCategories) conducted by the DCA (Singapore) and the Civil AviationAuthority (U.K.) basic technical examination for Flight EngineersLicence (including Air Law and Weight and Balance). In so far as thelast technical examination is concerned. Y1 indicates that he hadpassed Part 1 of the examination at two sittings in August 1983 andMay 1984. There is. however, nothing to show that he had completedPart 11 which required him to pass a CA 1180 Type Rating Flight Testand to satisfy the Practical Engineering requirements of 100 hourspractical experience on the type required on his Flight Engineer'sLicence in the 12 months preceding the issue of the Licence. Thework experience gained by him, according to his application (Y) was inrespect of Boeing 747 Maintenance at Singapore AirlinesMaintenance Hangar. He had also worked on L1011 aircraft inColombo and possessed, according to him, an excellent knowledge ofBoeing 747- systems and their operation. At the most Wijesinghe wasthus a qualified Apprentice Aircraft Maintenance Engineer – a GroundEngineer. He, however, did not possess a Flight Engineer's Licencenor had he undergone the basic training course similar to thatcompleted by the petitioner in respect of Flight Engineers. I might addthat in reponse to an inquiry made by the Manager, Flight Operationsof Air Lanka after the filing of this application it transpired that thepetitioner had completed 35 hours experience in a Boeing 727simulator and only 1.3 flying hours.
In analysing the facts and circumstances relied on by the petitioneras constituting unjust discrimination, it is necessary to refer to certainother relevant matters. It is conceded by the 3rd respondent that thepetitioner was, in view of documents P2. P2A, P3, P4 and P5,possessed of the basic qualifications of a Flight Engineer of a Boeing727 aircraft, although his experience did not qualify him to operatesolo as a Flight Engineer even on such a plane in any reputed airline. Itis also not in dispute that Air Lanka at the relevant time did not operatesuch planes but only Boeing 747, Lockheed 1011 and Boeing 737aircraft. Flight Engineers being required only for the first two types ofaircraft. It is further in evidence that although the petitioner'squalifications did not entitle him to operate as a Flight Engineer on anyof the aircraft of Air Lanka, he could, nevertheless, have qualified to doso on the successful completion of a course of training (calledtransitional or conversion training) pertaining to Boeing 747 and/orLockheed 1011 aircraft. According to the 3rd respondent this trainingwould have been of about 6 months' duration including a short period
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of training in Hongkong or Singapore According to the petitioner,however, this would not have taken more than 2 months in view of hisqualifications. It is also not denied that the applications made by thepetitioner to Air Lanka, although titled as being for the post of FlightEngineer, were treated and considered by Air Lanka as being for thepost of Cadet Flight Engineer, just as much as Wijesinghe'sapplication, also titled as being for the post of Flight Engineer, wastreated and considered by Air Lanka as being for the post of a CadetFlight Engineer, to which he was subsequently appointed. It is alsoconceded that at or about the time that Wijesinghe was recruited as aCadet Flight Engineer, that is, in August 1984, it was known to AirLanka that the petitioner was himself seeking the same post and thathis applications made in February and March 1 984 were still pending.On a consideration of the above facts and circumstances it appears tome that on the occasion that Wijesinghe was tested and appointed,the application of the petitioner was not even considered by Air Lanka.The petitioner's application was thus not considered in relation to andsimultaneously with that of Wijesinghe's in spite of the fact that primafacie the petitioner was better qualified and more eligible forappointment than Wijesinghe. Learned President's Counsel for therespondents submitted that Wijesinghe was appointed as a CadetFlight Engineer for the specific purpose of filling the vacancy createdby the resignation of one Victor Hatarasinghe on 7th August. 1984who had been recruited by Air Lanka as one of the 8 Cadet Pilots, all ofwhom completed their ground school training and cockpit proceduretraining course successfully in Sri Lanka and for whom Lockheed1011 Simulators had been reserved in Hong Kong for the purpose ofimparting to them their Simulator training. Victor Hatarasinghe left theservices of Air Lanka after completing his ground school and cockpitprocedure training but before the commencement of his Simulatortraining. Since by then Wijesinghe had, it was submitted, successfullycompleted a course of ground school training relating to Lockheed1011 aircraft (the course being one for Aircraft MaintenanceEngineers and as such a more detailed and comprehensive coursethan that designed for Cadet Pilots and Cadet Flight Engineers) he wasconsidered for appointment as a Cadet Flight Engineer and wassubjected to a written examination consisting of 4 papers, in all ofwhich he fared excellently obtaining over 82% in each paper.Wijesinghe was therefore, it was urged, appointed a Cadet FlightEngineer to fill the vacancy left by Victor Hatarasinghe. The petitioner,it was contended on behalf of the respondents, could not have been .
SCRajaratne v Air Lanka Ltd (Atukorale. J )133
even considered for appointment to the said vacancy for the reasonthat Air Lanka required a Cadet Second Officer or a Cadet FlightEngineer who could take the place of the said Hatarasinghe on theSimulator training course for which the petitioner was not qualifiedwhilst Wijesinghe was.
I do not think there is much merit in this contention Of learnedPresident's Counsel. Wijesinghe was essentially a Ground Engineer.He did not possess even the ba£ic qualifications of a Flight Engineer.On the contrary the petitioner was possessed of a Flight Engineer'slicence although with a Boeing 727 rating. He himself had successfullycompleted the ground school training course designed for FlightEngineers although, perhaps, it may have been less detailed and lesscomprehensive than that prescribed for Maintenance Engineers. Hehad also completed 35 hours' experience in a Boeing 727 Simulator.Wijesinghe had no such experience at all in any type of Simulator. Itwould thus appear that even for the specific purpose of fillingHatarasinghe's vacancy, the petitioner was equally, if not more,eligible for consideration than Wijesinghe. The failure of therespondents to even entertain his application at that stage was.therefore not one founded upon any relevant or rational ground andwas discriminatory of him. The arbitrary manner in which Air Lanka hasacted in the matter of selecting a candidate to fill the vacancy createdby Hatarasinghe s resignation has resulted in a denial of equality to thepetitioner which is violative of Article 1 2( 1) of the Constitution-! Furtherit is apparent that although the petitioner had made application inMarch 1984 and was assured that his application will be reviewedwith the next batch of recruits, yet he was not summoned for any testuntil he re-applied in September 1985, in consequence of which hewas asked to sit for a test held for the recruitment of Cadet Pilots, apost, for which he had never applied nor was qualified to apply. Uponprotesting at having been required to sit for such a test, he was set anexamination which purportedly appertained solely to the knowledgethat should be possessed by an applicant for the post of a Cadet FlightEngineer but which materially differed both in nature and content fromthe one set for Wijesinghe for a similar post. This in itself was unfairand discriminatory of petitioner and supports the submission oflearned counsel for the petitioner that this last test was intended tobelittle the petitioner's qualifications whilst the written test set forWijesinghe was one that had been tailor-made to suit his specialaptitudes The petitioner has thus been treated differentially from andhas been denied equality of opportunity with Wijesinghe. Such action
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on the part of Air Lanka, assuming it to be executive or administrativeaction, is constitutionally impermissible as it is violative of thefundamental right guaranteed by Article 12(1) and becomesjusticiable in this Court by virtue of Article 126.
The sole and exclusive jurisdiction vested in this Court by Article126 of the Constitution to hear and determine questions relating tothe infringement (actual or threatened) of fundamental rightsenshrined in Chapter 111 is confined to those that arise out ofexecutive or administrative action. In so far as fundamental rights areconcerned, it is only infringement or imminent infringement byexecutive or administrative action which falls to be justiciable in thisCourt under Article 126. The question therefore arises as to what ismeant by the expression 'executive or administrative action.' OurConstitution contains no definition of this expression. The trend of ourdecisions, however, has been to construe this expression as beingequivalent to action of the Government or of an organ or instrument ofthe Government. In Perera v. University Grants Commission (S.C.Appl. No. 57/80-S.C. Mins, of 4.9.1980: Fundamental Rights.Decisions of the Supreme Court, Vol. 1, p. 103 (1)) it was observedthat constitutional guarantees of fundamental rights are directedagainst the State and its organs and that the expression 'executive oradministrative action' would embrace executive or administrativeaction of the State or of its organs or instrumentalities. The UniversityGrants Commission established by the University Act, No. 16 of1978, was held by this Court to be an organ or instrumentality of theGovernment since the Act had assigned to the Commission certainfunctions pertaining to University education which were held to beimportant governmental functions. Hence its action in the matter ofadmission of students to the Universities under it was held toconstitute executive or administrative action. In Wijetunga v.Insurance Corporation of Sri Lanka (2) it was pointed out that Article 4(d) of the Constitution mandated all organs of the Government torespect and advance the fundamental rights enshrined in Chapter 111and that 'action by the organs of the Government alone constitutesthe executive or administrative action that is a sine qua non or basic toproceedings under Article 126.” After-a consideration of the severalprovisions of the Insurance Corporation Act, No. 2 of 1961, relating in •particular to the constitution of the Insurance Corporation, the natureof its powers.duties and functions, the degree of Ministerial controlover it and its financial resources, the Court took the view thgt whetherthe functional test or the governmental control test is applied, the
SCRsjaretne v. Air Lanka Ltd. (Atukorale. J.)135
—-;1 ■
Corporation could not be identified with the Government or be
regarded as its 'alter ego' or an organ of the State. The disciplinaryaction taken by it against some of its employees was therefore heldnot to constitute executive or administrative action. In Wijeratne v.The People's Bank (3) Sharvananda, J. observed that 'the cardinalquestion as to whether the People's Bank is properly to be regarded asmerely an instrument subservient to the State or in truth is acommercial bank not identifiable with the State has to be decided bylooking into the function and control of the bank.' Stating that therewere several factors to be considered in determining whether acorporation is an agency or instrumentality of the Government, hecited with approval the following passage from the judgment ofBhagwathi J. in Ramana v. International Airport Authority of India (4)which set out some of the relevant factors, namely, 'whether there isany financial assistance given by the State, and if so, what is themagnitude of such assistance, whether there is any other form ofassistance given by the State, and if so, whether it is of the usual kindor it is extraordinary, whether there is any control of the managementand policies of the corporation by the State and what is the nature andextent of such control, whether the corporation enjoys State conferredor State-protected monopoly status and whether the functions carriedout by the corporation are public functions closely related togovernmental functions.' Sharvananda, J. held that on the materialbefore .him the major role of the People's Bank was in the commercialsphere; that it was a commercial bank; that there was no nexusbetween the State and its banking activities; that the State was notinvolved in the Commercial activities of the bank and that suchcommercial activity of the bank did not qualify as State action. Hetherefore held that the action of the bank in re-organising its securityservices, being a part of its commercial activities, did not amount toexecutive or administrative action. In Ariyapala Guneratne v. ThePeople's Bank (5) the question before this Court was whether adeclaratory action could be,, .dintained against the People's Bank for aviolation of the fundamental right guaranteed by Article 18 (1) (f) ofthe Republican Constitution of 1972, which did not contain anyprovision corresponding to Article 126 of the present Constitutionenabling a person aggrieved by executive or administrative action toseek redress directly in this Court. In determining whether the Bankconstituted the State within the meaning of S.18(1) of the 1972Constitution, Wanasundera, J. examined the corresponding provisionsin Article 19 of the Indian Constitution, the definition of 'the State'
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contained in Article 12 thereof and certain Indian decisions andobserved that the Indian courts have progressively extended theconcept of 'the State' to embrace almost every institution performingpublic functions and that State action as interpreted by Indian courts 1comprehended a much wider meaning than that connoted by theexpression executive or administrative action in Article 126. Afterpointing out that numerous provisions of the People's Bank Act, No.29 of 1961, indicated a close nexus of the Bank with the Governmentend also Government control of the Bank, Wanasundera, J.distinguished Wijeratne's case (supra) and held that the People's Bankconstituted the State or the Government within the meaning of S. 18of the 1972 Constitution in so far as the matter in issue before himwas concerned. He also added that in his view even under our presentConstitution the concept of State was a wider concept than theexpression 'executive or administrative action.' In Roberts v.Ratnsyake (6) one matter that arose for consideration was whether aMunicipal Council established under the Municipal Councils Ordinance(Chap. 252) was an organ or agency of the Government. Tambiah. J.had no hesitation in holding that a Municipal Council performedgovernmental functions and its action would therefore constituteexecutive or administrative action within Article 126. L. H. de Alwis, J.held that a Municipal Council was an organ or instrument of the Stateboth on the functional as well as the governmental control test. Wawere also referred to several Indian decisions which have to be viewedin the light of the definition of 'the State' contained in Article 12 (PartIII) of the Indian Constitution which runs as follows:
"In this Part, unless the context otherwise requries, 'the State'includes the Government and Parliament of India and theGovernment and Legislature of each of the States and al! local orother authorities within the territory of India or under the control ofthe Government of India."
In Rajasthan State Electricity Board, Jaipur v. Mohan Lai (7) thequestion arose whether the Rajasthan Electricity Board was anauthority within the meaning of the expression 'other authorities' inArticle 12. The Electricity Act empowered the Board, inter aiia, to givedirections the disobedience of which was punishable as a criminaloffence. It also invested the Board with extensive powers of controlover electricity undertakings. The judgment of the majority (deliveredby Bhagwati, J.) held that the expression 'other authorities' included allstatutory authorities on whom powers are conferred by law and that
SCRajaratne v. Air Lanka Ltd (Atukorale. J.) ■137
th9 conferment of a power on a statutory authority to give bindingdirections the disobedience of which entailed penal consequenceswas important as being indicative that the authority was 'the state'.The circumstance that the Board carried on an activity in the nature oftrade or commerce would not indicate that it should be excluded fromthe ambit of 'the state'. In his concurring judgment Shah, J. held thatthe power of the Board to make rules and regulations and to enforce ■compliance with them was in substance the exercise of the sovereignpower of the State delegated to the Board and that therefore theBoard fell within the meaning of 'the State' as defined in the Article.
In Sukhdev Singh v. Bhagatram (8) the Court considered whetherthe Oil and Natural Gas Commission, the Life Insurance Corporationand the Industrial Finance Corporation (all statutory corporations)were authorities within the meaning of Article 12. Ray. C.J. in thecourse of his leading judgment commented that in the RajasthanElectricity Board case (supra) "it was said that the power to givedirections, the disobedience of which must be punishable as a criminaloffence would furnish one of the reasons for characterising the bodyas an authority within the meaning of Article 12. The power to makerules or regulations and to administer or enforce them would be one ofthe elements of authorities contemplated in Article 12." Upon ananalysis of the provisions of the statutes creating the threecorporations and adopting the test aforementioned, the learned ChiefJustice held that they were authorities within the meaning of Article12. Applying this same test Mathew, J in a separate judgment held 'that the Oil and Natural Gas Commission was an authority within themeaning of the expression 'other authorities' and therefore State. Inso far as the other two corporations were concerned which, accordingto him, had no such statutory powers, he stated that the questionwhether a corporation set up by statute to carry on a business ofpublic importance or which is fundamental to the life of the people isState' had to be decided on other considerations. After discussingseveral American and Indian decisions and examining the relevantprovisions of the Life Insurance Corporation Act and the IndustrialFinance Corporation Act, which established the Life InsuranceCorporation and the Industrial Finance Corporation respectively, andwhich revealed that the Central Government had contributed to theiroriginal capital, that a part of their profits went to it. that they carriedon businesses of great public importance, that they enjoyed total or ,virtual monopolies in their respective business fields and that the
138Sri Lanka Law Reports[1987] 2 Sri L.R.
Central Government exercised control over matters of policies, thelearned Judge held that the two corporations were agencies orinstrumentalities of the 'State' and were therefore 'State' within themeaning of Article 12.
In Ramana Dayaram Shetty v. The International Airport Authority ofIndia (supra) the question as to what are the 'other authorities'referred to in Article 12 came up for consideration again. The Court(per Bhagwati, J.) referred to the decision in the Rajasthan ElectricityBoard case (supra) and said:
'The ratio of this decision may thus be stated to be that aconstitutional or statutory authority would be within the meaning ofthe expression 'other authorities', if it has been invested withstatutory power to issue binding directions to third parties thedisobedience of which would entail penal consequences or it has, the sovereign power to make rules and regulations having the force' of law. This test was followed by Ray, C.J., in Sukhdev v. BhagatRam (AIR 1975 SC 1331) {supra). Mathew, j., however, in thesame case, propounded a broader test, namely, whether thestatutory corporation or other body or authority, claimed to fallwithin the definition of 'State', is an instrumentality or agency ofGovernment: if it is, it would fall within the meaning of theexpression 'other authorities' and would be 'State'. Whilst' accepting the test laid down in Rajasthan Electricity Board v. MohanLa/ (AIR 1967 SC 1857) (supra) and followed by Ray, C.J., inSukhdev v. Bhagat Ram (supra), we would, for reasons alreadydiscussed, prefer to adopt the test of governmental instrumentalityor agency as one more test and perhaps a more satisfactory one fordetermining whether a statutory corporation, body or other: authority falls within the definition of 'State'. If a statutorycorporation, body or other authority is an instrumentality or agencyof Government, it would be an 'authority' and therefore 'State', within the meaning of that expression in Article 12.'
After examining the relevant provisions of the International AirportAuthority Act, 1971, relating to the establishment of the InternationalAirport Authority of India by the Central Government, the compositionof its membership, the power of the Central Government to appoint.and remove the membership, the vesting in the Authority of certainproperties and assets of the Central Government and of certain debts,obligations and liabilities incurred by the Central Government, thecapital provided by the Central Government, the obligation of the
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Authority to pay, after deducting certain charges, the balance of itsannual net profits to the Central Government, the requirement to haveits accounts audited by the Auditor-General and to forward the auditreport to the Central Government for the purpose of placing the samebefore both Houses of Parliament, the provision that its officers andemployees are deemed to be public officers enjoying immunity fromsuit, prosecution and other legal proceedings for anything done ingood faith in pursuance of the Act or any rule or regulation thereunder,the power of the Central Government of temporarily divesting theAuthority in certain circumstances of its management and ofsuperceding the Authority, the power of the Central Government togive written directions from time to time on matters of policy which arebinding on the Authority, the power given to the Authority of makingregulations prescribing, inter alia, that a contravention of the samewould entail penal consequences, the provision in the Act fortranferring the entire department of the Central Government pertainingto the administration of airports and air navigation services to theAuthority, the Court inferred that the Authority was an instrumentalityor agency of the Central Government and therefore 'other authority'falling within the definition of 'the State' both on the narrow view takenby the majority in Sukhdev's case (supra) as also on the broader viewtaken therein by Mathew, J., which latter view the Court adopted asbeing a more satisfactory test.
In Ajay Hasia v. Khalid Mujib (9) the Court whilst affirming the viewtaken by Mathew, j. in Sukhdev Singh's case (supra) that theGovernment acting through the instrumentality or agency ofcorporations should be subject to the same constitutional limitationsas the Government acting through the instrumentality or agency ofnatural persons, approved of the tests laid down in the InternationalAirport Authority of India case (supra) for determining whether acorporation established by statute or incorporated under a law suchas, for example under the Companies Act, is an instrumentality oragency of the Government. The Court (per Bhagwati, J.) summarisedthese tests as follows:
whether the entire share capital of the corporation is held by heGovernment. If so, it would go a long way to indicate that thecorporation is an instrumentality or agency of the Government.
whether the financial assistance provided by the State is so muchas to meet almost the entire expenditure of the corporation. If so,it would be indicative of the corporation being impregnated withgovernmental character.
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whether the corporation enjoys monopoly status which is Stateconferred or State protected. If so, it would be a very relevantfactor to be taken into consideration as being indicative thatcorporation is an instrumentality or agency of the Government;
whether there exists deep and pervasive State control of thecorporation which would afford an indication that thecorporation is a State agency or instrumentality;
whether the corporation performs functions of publicimportance and which are closely related to governmentalfunctions; and
whether the corporation is one to which a department ofGovernment has been transferred. If so, it would stronglysupport the inference that the corporation is an instrumentalityor agency of the Government.
All the above circumstances are relevant for the purpose ofdetermining whether a particular corporation is or is not aninstrumentality or agency of the Government. Having expressed hiscomplete approval of the formulation of the above tests in theInternational Airport Authority case (supra), Bhagwati, J. said:
"We may point out that it is immaterial for this purpose whether thecorporation is created by a statute or under a statute. The test iswhether it is an instrumentality or agency of the Government andnot as to how it is created. The inquiry has to be not as to how thejuristic person is born but why it has been brought into existence.The corporation may be a statutory c xporation created by a statuteor it may be a Government compan or a company formed underthe Companies Act, 1956, or it may be a society registered underthe Societies Registration Act, 1860, or any other similar statute.Whatever.be its genetical origin, it would be an "authority" within themeaning of Article 12 if it is an instrumentality or. agency of theGovernment and that would have to be decided on a properassessment of the facts in the light of the relevant factors. Theconcept of instrumentality or agency of the Government is not'limited to a corporation created by a statute but is equally applicableto a company or society and in a given case it would have to bedecided, on a consideration of the relevant factors, whether thecompany or society is an instrumentality or agency of theGovernment .so as to come within the meaning of the expression"authority" in Article 12."
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Having regard to the Memorandum of Association and the rules ofthe society made thereunder, the Court concluded that the Society,registered under the Jammu and Kashmir Registration of SocietiesAct, 1898, which established and managed the Regional EngineeringCollege, Srinagar, was an instrumentality or agency of the State. Inreaching this conclusion the court took into consideration the fact thatthe society's composition was dominated by representativesappointed by the Central Government as well as certain StateGovernments with the approval of the Central Government; that theCentral and State Governments provided the entire monies requiredfor running the colleges; that other monies could be received by thesociety only with the approval of the Central and State Governments ;that the rules of the society required prior approval of suchGovernments; that accounts'of the society had to be submitted tothem for their scrutiny and satisfaction; that the State Governmenthad the power to appoint a person to review the working and progressof the society; that the State Government was empowered to givedirections and take such action as it may consider necessary inconsequence of such person’s report which the society and thecollege was obliged to comply with; that the society was notcompetent to dispose of any of its immovable property without theapproval of both Governments; that the Board of Governors in chargeof the general superintendence, direction and control of the affairs ofthe society and of its income and property was largely controlled bynominees of both Governments. All these factors disclosed that bothGovernments had a deep and pervasive control of the working of thesociety, which was merely a 'projection' of the Central and StateGovernments. The society was therefore held to be an instrumentalityor agency of the Central and State Governments.
In Som Prakash v. Union of India (10) the Burmah Shell Oil StorageLtd. was statutorily taken over by the Central Government by virtue ofthe provisions, of the Burmah Shell (Acquisition of Undertakings inIndia) Act, 1976. The Central Government then by notification, madein terms of the Act, vested the Undertaking in the 2nd respondent, agovernment company registered as a company under the IndianCompanies Act. The question that arose was whether a writ will lieunder Article 32 of the Indian Constitution against the 2nd respondentwhich was neither a government department nor a statutorycorporation but just a company registered under the Companies Act.
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After adverting to certain passages in the judgment of Mathew, J. inSukhdev's Case (supra), Krishna Iyer, J. delivering the judgment of themajority, stated:
"There is nothing in these observations to confine the concept ofState to statutory corporations. Nay, the tests are common to anyagency or instrumentality, the key factor being the broodingpresence of the State behind the operations of the body, statutoryor other.
A study of Sukhdev's case, (supra) (1975 3 SCR 619: AIR 1975SC 1331) (a Constitutional Bench decision of this Court) yields theclear result that the preponderant considerations for pronouncing anentity as State agency or instrumentality are (1) financial resourcesof the State being the chief funding source, (2) functional characterbeing governmental in essence, (3) plenary control residing inGovernment, (4) prior history of the same activity having beencarried on by the Government and made over to the new body and(5) some element of authority or command. Whether the legalperson is a corporation created by a statute, as distinguished fromunder a statute, is not an important criterion although it may be anindicium."
Stating that the Airport Authority of India case (supra) wasconsistently and correctly decided and applying the criteriapropounded therein on a cumulative basis, Krishna Iyer, J. held that the2nd respondent which was clothed vyith certain rights and duties by .virtue of the provisions of certain sections in the Burmah Shell(Acquisition of Undertakings in India) Act, 1976, was aninstrumentality of the Central Government and an 'authority' andtherefore 'state' within the meaning of Article 12 and a writ will lieagainst it under Article 32. From a perusal of the recent Indiandecisions cited above it would be clear that the test formulated byMathew, J. in Sukhdev Singh's case (supra), namely, whether thecorporation is an agency or instrumentality of the Government, hasbeen accepted and adopted as the most reliable test for determiningwhether it is 'State' for the purposes of Part III of the IndianConstitution. If the corporate body is an instrumentality or agency ofthe Government then Part III will trammel its operations and actions.To ascertain whether it is an instrumentality or agency of theGovernment the cumulative effect of all the relevant factors have to beevaluated.
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143
Learned counsel for the petitioner invited us to adopt this test ofgovernmental agency or instrumentality propounded in the recentIndian decisions aforementioned as being a more rational and realistictest for determining whether the acts of a corporation, created by orunder a statute, constitute executive or administrative.action for thepurpose of amenability to constitutional jurisdiction under Article 126.He pointed out that whilst this test has not been expressly consideredin any of our decisions, its validity and cogency appear to be reflectedin the decision of this court in Wijeratne v. People's Bank (supra).Learned President's Counsel for the 1st to the 3rd respondentssubmitted that in determining the question whether a legal entity orbody of persons with a distinct legal personality and an existenceseparate from the Government is amenable to the special jurisdictionunder Article 126, the constitutionally correct approach would be toascertain whether in the discharge of its functions or duties or in theexercise of its powers such entity or body has been endowed by lawwith any of the special powers, rights, privileges or immunities whichare ordinarily attached to or enjoyed by the State. The presence ofsuch special characteristics in such a legal entity or body, not merely inits organisational structure but also in the very modes of action, wouldit was submitted, render a citizen, in so far as its acts are concerned,to the same degree of vulnerability in respect of his fundamental rightsas to acts of the State itself. Accordingly the necessity would arise forthe protection of Court to safeguard these fundamental rights againstthe acts of such an entity or body for which purpose the citizen isgranted a speial remedy under Article 12. Learned President's Counseltherefore contended that the inquiry must be directed to ascertainingwhether the legal persona shares with the State any of the attributesarising out of the latter's sovereign status thereby distinguishing.itfrom any other legal entity or body engaged in a similar undertaking.The possession of any such unique characteristics or attributes by alegal persona would impress its acts with the character of 'executiveor administrative action' within the contemplation of Article 126.Learned President's Counsel submitted that this was the decisive testfor determining whether a legal entity or body is within the sphere ofState agencies engaging in executive or administrative action. Theother tests would not be appropriate. He maintained that Air Lanka didnot possess or enjoy any special power conferred on it by law enablingit to alter the legal rights of others by its unilateral action such as, forinstance, the power of compulsory acquisition or quasi judicialpowers. Nor did it have any special privileges granted to it by law such
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as, for instance, a right of franchise or monopoly in a field of activitywhich would otherwise be within the area of private enterprise or anexclusive right or monopoly of the State. Nor did it enjoy any specialimmunity such as immunity from taxes or rates or other impositions bythe State not enjoyed by others engaged in the same activity. He alsostressed that Air Lanka had no power to make regulations or by-lawsaffecting persons generally other than those transacting business withit and capable of enforcement through legal proceedings. It was notsubject to Parliamentary control in regard to its accounts through theAuditor-General. Nor was it subject to control by the executive byvirtue of a statutory provision to issue general or special directionsvested in the Minister in charge of the subject of aviation. LearnedPresident's Counsel submitted that in so far as the 'control test' wasconcerned, what was relevant was the existence of de jure control andnot mere de facto control. Judged by the de jure control test Air Lankawas, he submitted, a fully autonomous body and its action did notconstitute executive or administrative action. The de jure control testis the most important criterion and is itself a decisive test and had tobe distinguished from de facto control exercised by extra legal modes.He further stressed that there were no features in Air Lanka'sorganisational structure which reveal any integral connection with theState, for instance, its designation as the agent of the State like theMonetary Board of the Central Bank. The very existence and origin ofAir Lanka, it was pointed out, was not the outcome of State action. Itis not a creature of the statute deriving therefrom its very constitution,powers, duties and functions but was set up by agreement inaccordance with the provisions of the Companies Ordinance and assuch was not an agency of the State. Learned President's Counsel,whilst maintaining that Indian decisions though helpful should beviewed with caution in view of the fact that the Indian definition of'State' embraces the entire gamut of State action and not merelyexecutive or administrative action, placed reliance on the dissentingjudgment of Alagiriswami J. in Sukhdev Singh's, case (above) andcertain decisions referred to therein, e.g., Sabhajit Tewari v. Union ofIndia (11) and Praga Tools Corporation v. C. V. Immanual (12). Theselater decisions have all been examined fully and distinguished both inAjay Hasia's case as well as Som Prakash's case and I do not think itnecessary for me to burden this judgment by referring to them. Theburden of learned President's. Counsel-argument can therefore besummarised as follows: If the legal entity against whom the complaintof infringement of fundamental rights is made is shown to be charged
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Rajaratne v. Air Lanka Ltd. (Atukorale. J.)
145
•with duties of a public nature and for that purpose such entity isconferred special rights, privileges or immunities, which are ordinarilynot characteristic of a person or entity engaged in the same activity,and these characteristics have been conferred on the entity throughlegislative action of the State, then the act complained of may properlybe described as executive or administrative action for the purposes ofArticle 126. The most practical and useful approach, according tohim, is to ascertain whether the infringement.has been caused by abody which is endowed by law with some part of the coercive poweror special privileges enjoyed by the State. This approach has found noapproval in the recent decisions of the Indian courts above-mentioned,which have consistently adopted the broader view taken by Mathew J:in Sukhdev Singh's case. 'The concept of State has undergone drasticchanges in recent years. Today state cannot be conceived of simply asa coercive machinery wielding the thunderbolt of authority. It has to beviewed mainly as a service corporation"-per Mathew J. in SukhdevSingh's case. Learned President's Counsel was not able to cite anylocal decision in support ofthe sovereign power test advanced by him.
The expression 'executive or administrative action' has not beendefined in our Constitution. It excludes the exercise of the specialjurisdiction of this court under Article 126 in respect of the acts of thelegislature or the judiciary. Article 4 of the Constitution mandates thatthe fundamental rights enshrined in Part III 'shall be respected,secured and advanced by all the organs of the government.' Anexamination of our decisions indicate that this expression embracesactions not only of the government itself but also of organs,instrumentalities or agencies of the government. The government mayact through the agency of its officers. It may also act through theagency of juridicial persons set up by the State by, under or inaccordance with a statute. The demands and obligations of themodern welfare State have resulted in an alarming increase in themagnitude and range of governmental activity. For the purpose ofensuring and achieving the rapid development of the whole country bymeans of public economic activity the government is called upon toembark on a multitude of commercial and industrial undertakings. Infact a stage has now been reached when it has become difficult todistinguish between governmental and non-governmental functions.This distinction is now virtually- non-existent. The rigid and tardyprocedures commonly associated with governmental departmentsand the red .tapism inherent in such slow motion procedures have
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compelled the government to resort to the device of publiccorporations to carry on these numerous commercial and industrialundertakings, which require professional skills of a highly specialisedand technical nature. But by resorting to this device of the corporateentity the government cannot be permitted to liberate itself from itsconstitutional obligations in respect of fundamental rights which it andits organs are enjoined to respect, secure and advance. Iri thecircumstances I am of the opinion that the expression 'executive oradministrative action' in Articles 17 and 126 of the Constitutionshould be given a broad and not a restrictive construction. I amtherefore inclined to adopt the test of governmental agency orinstrumentality propounded in the later decisions of the Indian courtsas being a more rational and meaningful test than the sovereign powertest relied upon by learned President's Counsel. On the application ofthe former test it would follow that, although the presence of any• sovereign characteristics or features in the corporate body would bestrongly indicative of it being an organ or agency or instrumentality ofthe government, yet the absence of any such characteristics orfeatures would not by itself deprive the body of such character if itexhibits other indicative indicia enumerated in the later Indiandecisions.
Having reached this conclusion I shall now proceed to examinewhether Air Lanka exhibits any factors or indicia which would showthat it is an organ or agency of the government always bearing in mindthe matters urged by learned President's Counsel to the contrary. AirLanka is a company incorporated under the provisions of theCompanies Ordinance (Cap. 145)-vide R7. The subscribers to theMemorandum of Association (R8) consist of 7 persons of whom 4 areindividuals and the other 3 are corporations. Three of the individualsare those who at the time held the offices of the Secretary of theCabinet, the Secretary to the Ministry of Finance and Planning and theSecretary to the Treasury, all of whom in their official capacitiesrepresented the Government. The 3 corporations are the Bank ofCeylon, the Ceylon Shipping Corporation and the People's Bank, whichare semi-government organisations. According to the Memorandumof Association the primary object for which Air Lanka was establishedis to carry on the business of a local and international airline and tooperate air transport services for passengers and cargo in the Republicof Sri Lanka or any part of the world and/or to and from the Republic ofSri Lanka to any part of the world. According to its Articles ofAssociation (which constitute its regulations) the share capital of the
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147
Rajaratne v Air Lanka Ltd. (Atukorale, J.j
company is Rs. 500,000,000 (five hundred million) with power to, increase or decrease the same. The shares in the capital of thecompany for the time being are, unless' otherwise directed by it at ageneral meeting, to be at the disposal of the Board of Directors but theBoard is enjoined to ensure that in the disposal or allotment of theshares the total holding of shares in the capital of the company by oron behalf of the Government of Sri Lanka shall not at any time be lessthan 60% of the issued capital for the time being. The first Directors ofthe company are appointed by the Government, i.e. by the Minister incharge of aviation. The Directors shall not be less than 5 nor morethan 7 in number, of whom 2 shall be elected. So long as theGovernment holds (whether directly or through any governmentinstitution or company) not less than 60% of the issued capital for thetime being it is entitled to nominate and have on the Board a majorityof the Directors, referred to as nominee Directors. Such a Directormay at any time be removed from office by the Government (theMinister) and another person nominated in his place to fill the vacancy.A nominee Director (unlike an elected Director) cannot be requested inwriting by his co-Directors to resign nor can he be removed from officeby resolution of the company. The Chairman of the Board is appointedby the Government (the Minister). The business of the company ismanaged by the Board. These provisions reveal the legal andpervasive character of control which the Government exercises overthe company through its nominees. The authorised capital of thecompany has, by 2 special resolutions, been increased from fivehundred million to five thousand million rupees divided into50,000,000 shares of Rs. 100 each. Out of this amount32,650,005 shares have been issued as set out in the annual returnof the company dated 2.1.1986 (X), Of these latter shares theSecretary to the Treasury holds 32,350,000 whilst the People's Bankand the Bank of Ceylon hold 150,000 shares each. Thus more than99% of the issued share capital is held directly by the Governmentwhilst the other two semi-government institutions hold virtually thebalance. As pointed out by learned counsel for the petitioner, it is alsosignificant that in this country the operation of air transport serviceswas earlier a function that was envisaged to be carried on by theGovernment under the name of Air Ceylon through the Department ofCivil Aviation. Subsequently Air Ceylon Ltd., a company establishedunder the Air Ceylon Act (Cap. 280), commenced to carry on airtransport services. S. 30 of this Act vested all the assets of the airundertaking of Air Ceylon in Air Ceylon Ltd. from the date of
148Sri Lanka Law Reports[1987] 2 Sri L. R.
commencement of the latter's business. Air Ceylon Ltd., just as muchas Air Lanka, was empowered and authorised to operate air transportservices, both local and international. In fact the objects of Air Lankaand Air Ceylon Ltd. are substantially the same. A close scrutiny of theprovisions of the Air Ceylon Act point unmistakably to the fact that AirCeylon Ltd. is an organ of the Government-vide sections 3 (4), 4, 4A,•5, 6, 7, 9, 10, 11 (a), 12, 14, 21. 22, 24, 27 (later repealed), 28,29, 30 and 32. Hence historically the airline- transport service is afunction that was assigned to and an activity that was carried on by oron behalf of the Government. Air Ceylon Ltd., though its corporateshell still exists, has virtually ceased to function.
It is also relevant to note that the Air Navigation (Special Provisions)Act, No. 2 of 1982, empowered the Minister, by order published inthe Gazette, to appoint “as an Agent of the Government, a companyregistered under the Companies Ordinance, being a company of which95% of the shares are held by the Government and the balance sharesare held by the Corporation or the body or company which operatesthe national airline" for certain purposes specified in the Act. "Nationalairline' is defined in the Act as the airline for the time, beingdesignated as the national carrier of Sri Lanka. This is obviously areference to Air Lanka which carries the national flag. This provisionitself recognises a company incorporated under the CompaniesOrdinance being an agent of the government for certain specified. purposes.
All the above circumstances enumerated by me show that Air Lankais no ordinary company. It has been brought into existence by thegovernment, financed almost wholly by the government and managedand controlled by the government through its own nominee Directors.It has been so created for the purpose of carrying out a function ofgreat public importance which was once carried out by the'government through the agency of a statutory corporation. In realityAir Lanka is a company formed by the government, owned by thegovernment and controlled by the- government. The juristic veil ofcorporate personality donned by the company for certain purposescannot, for the purposes of the application and enforcement offundamental rights enshrined in Part III of the Constitution, bepermitted to conceal the reality behind it which is the government. Thebrooding presence of the government behind the operations of thecompany is quite manifest. The cumulative effect of all the abovefactors and features would, in my view, render Air Lanka an agent or
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149
organ of the government. Its action can therefore properly bedesignated as executive or administrative action within the meaning ofArticles 17 and 126 of the Constitution. The petitioner has thusestablished that he is entitled to relief under Article 126(4).
The only other matter that remains for consideration is the nature ofthe relief that should be granted to him. Article 126(4) empowers thiscourt to grant a petitioner such relief as it may deem just and equitablein the circumstances. There is no doubt that the petitioner in this casehas suffered grave financial loss, particularly by way of the heavyexpenditure incurred by him in obtaining his qualifications and trainingabroad. His hopes and aspirations of obtaining employment in thenational carrier have proved abortive. I think an award of Rs. 200,000(two hundred thousand) would be reasonable compensation to him inthe circumstances of this case. I therefore make order directing the1 st respondent (Air Lanka Ltd.) to pay to the petitioner the said sum ofRs. 200,000. He will also be entitled to a further sum of Rs. 5000 ascosts from the 1 st, 2nd and the 3rd respondents.
SENEVIRATNE, J.
The petitioner K. M. N. D. Rajaratne has obtained qualifications as aFlight Engineer in Air Crafts Boeing 727 from Northrop UniversityInstitute of Technology of the United States of America, an Institutionapproved by the Federal Aviation Agency of the United States ofAmerica. On these qualifications the petitioner has obtained a FlightEngineer's Licence in respect of Boeing 727 Aircraft, issued by theDirector of Aviation, Sri Lanka under the relevant regulations of the AirNavigation Act No. 15 of 1970. By applications of March, 1984 andSeptember 1985 the petitioner on his own applied for a post of FlightEngineer in Air Lanka Limited the 1st respondent to this application.While the petitioner's application in March 1984, on which applicationhe was also interviewed by the 1st respondent, was pending, inAugust 1984, the 1 st respondent Air Lanka Limited recruited as aCadet Flight Engineer Aruna Wijesinghe, who was a trainee GroundEngineer in Air Lanka Limited. In this petition the petitioner states thatthe 'non offer' of employment to the petitioner, who was qualified forrecruitment as a Flight Engineer was discriminatory and in violation ofthe petitioner's fundamental rights that 'all persons are equal beforethe law and are entitled to the equal protection of the law' as
150.Sri Lanka Law Reports[1987] 2 Sri LB.
guaranteed by Article 12(1) of the Constitution. In this applicationmade under Article 126 of the Constitution the petitioner prays, interalia
for an order declaring that the fundamental rights enshrined inArticle 12(1) have been violated;
to direct the respondents to recruit the petitioner to the post of
Flight Engineer;/
ancK(c) for an award of damages as claimed.
I will first consider the claims of the petitioner to be appointed as aFlight Engineer in Air Lanka Limited. The petitioner in his applicationmade in March 1984 (RIO), and the later application of 17.9.85 (P6)has applied for "a post of Flight Engineer at Air Lanka'. It is acceptedthat the 1 st respondent Air Lanka treated this application as one, only,for a post of Cadet Flight Engineer for the reason that the petitioner asadmitted by the 1 st respondent had the basic qualifications as a FlightEngineer, but did not have the qualifications to be a Flight Engineer inthe type of Air Craft then operated by Air Lanka to wit-
fa) Boeing 747,
b) Lockheed 1011,
Boeing 737.
Further, in the course of the petition filed the petitioner admits that hewould have qualified for a post of Flight Engineer only after a shortcourse of what he called 'Transitional Training".
The petitioner had passed the G.C.E. (Ordinary Level) Examinationand in 1974, he had undergone a course of training in Flying at theRatmalana Airport. In 1976 he had passed a technical examinationand obtained a private licence. A private licence is in contra -distinction to a Commercial Pilot’s Licence, which kind of licence isimperative to be a Pilot in a Commercial Air Line. In 1983 thepetitioner has enrolled for a Course of Training as a Flight Engineer, inthe Northrop University Institute of Technology in California, UnitedStates of America, and on completion of the Course he has beenawarded a Certificate dated 17th September, 1983 (P2). Having'successfully completed the curriculum of Flight Engineer",, thepetitioner has also received a Certificate dated 15.9.83 (P2A) fromthe Flight Engineer Instructor, Northrop University, certifying that hehas "successfully completed the Flight Engineering Programme". The
SCRajaratne v. Air Lanka Ltd. (Seneviratne, J.)15 7
petitioner has obtained further certificates-Federal AviationAdministration, U.S.A. School Graduation Certificate dated 17.6.83(P3), the Federal Aviation Agency Certificate Flight Engineer (P4), andthe Flight Engineer's Licence issued by the Department of CivilAviation Sri Lanka in March 1984 (P5).
At times relevant to this application Air Lanka had not formally calledfor applications for post of Cadet Flight Engineer, or Flight Engineer,and both applications for post of Flight Engineer made by thepetitioner referred to above have .been voluntarily made by him,motivated by the desire of a young man to obtain a post suitable for hisspecialised field of training. When the petitioner made the firstapplication in March 1984, he has been called for an interview, andaccording to the petitioner he was informed that he was fully qualifiedfor the post, but Air Lanka was not recruiting Flight Engineers at thetime, and assured that the application will be considered on a laterdate. The 3rd respondent Sarath Jayasuriya Chief Flight Engineer andthe Flight Engineer Instructor of the 1 st respondent, who has filed themain affidavit relied on by the 1 st respondent has affirmed that it ismost unlikely that the petitioner would have been informed that he wasfully qualified, because he was not fully qualified.
In the Sunday Observer of 15.9.85 the 1st respondent byadvertisement called for applications .in respect of the vacancies forCadet Pilots in Air Lanka. The notice calling for applications sets outthe qualifications necessary, and terms of appointment. The noticeparticularly states-"candidates will be required to pass a written testand flying test to prove their ability" (underlined by me for the reasonthat the petitioner has protested that a written test was held in respectof his application for post of Flight Engineer, whereas it was not thepractice of the 1 st respondent Air Lanka earlier to hold a written test,and as against this the 3rd respondent in his affidavit has affirmed asto why Air Lanka began to hold written tests for the applicants at thisrelevant time.) At about the time the Air Lanka advertised forapplications for Cadet Pilots which appeared in the press, thepetitioner by his application dated 17.9.85 voluntarily applied for "apost of Flight Engineer at Air Lanka". There is no evidence which revealswhether the petitioner was aware or not aware of the notice calling forapplications for post of Cadet Pilots. But this strange coincidencebetween the notice calling for applications for post of Cadet Pilots, andthe application by the petitioner for a post of Flight Engineer has led to
152Sri Lanka Law Repons[1987J2 Sri L.R.
unwarranted complications and confusion, on which the petitionerbases his main claim that he was discriminated in the selection.Though the notice (P8) called for applications for Cadet Pilots, and theapplication (P6) by the petitioner was for a post of Flight Engineer, thepetitioner received a communication from the Air Lanka Limited dated2.12.85 (P7) with the caption "post of a Cadet Pilot", and requestedthe petitioner-'reference to. your application for the above post callover at Flight Operations Department for a technical test on Friday 6thDecember, 1985". It is this particular letter (P7) that has createdcomplications and problems which has mainly led to this application.Here, the 1 st respondent Air Lanka Limited is calling an applicant for apost of Flight Engineer for a technical test in respect of theapplications received for the post of Cadet Pilot, in response to thepaper advertisement.
The grievance of the petitioner which has resulted from the aboveconfusion or complication is the one set out by the petitioner at lengthin this application. The petitioner states that in response to the letter(P7) of 2.12.85, he presented himself for the technical test on6.12.85, and the exam held was in respect of Cadet Pilots, for whichpost he did not apply. As such it was unfair by the petitioner, and alsoit was a wrong done to the petitioner. The 3rd respondent has furtherconfused and complicated the matter by affirming in his first affidavitdated 5.6.86 that the "petitioner presented himself for the saidtechnical test along with the other applicants for the pqst of CadetPilot without any protest. The 3rd respondent has further affirmed thatit was "neither wrong nor unfair to subject the petitioner to the sametest, as the other applicants for the post of Cadet Pilot, because thepetitioner could have answered a total of 19 of the said questionswhich related solely to the basic knowledge of an applicant forappointment as Cadet Flight Engineer and obtained a total of 86marks. Had the petitioner answered the said questions satisfactorilyhe could have been appointed a Cadet Flight Engineer". This is afantastic explanation for a blunder made by the 1 st respondent. AirLanka, to explain how and why an applicant for the post of FlightEngineer was permitted to present himself for a post in respect ofCadet Pilots, which in the field of aeronautics are two widely differentfields. The 3rd respondent further affirmed that at that test thepetitioner answered only 9 questions and obtained only 19 marks, andthe implication is that as such he could not be recruited as a CadetFlight Engineer. These affirmations are made in paragraphs 8:1, 8:2
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SCRajaratne v. Air Lanka Ltd. (Seneviratpe, J.)
and 8:3 in an attempt for irresponsible justification of a patent blunderby the 1st respondent, whereas the 1st respondent should havefrankly admitted that it was an administrative blunder in respect of thistest and that when the petitioner pointed out this blunder and thewrong done to the petitioner, the position was corrected by bolding asecond test meant for a Cadet Flight Engineer in respect of only thispetitioner. After the petitioner pointed out that he was called for a testfor Cadet Pilots, the 1 st respondent remedied this position by callingthe petitioner by letter dated 1.1,86 (P9) to present himself for awritten examination on 13.1.86 for post of Cadet Flight Engineer. Thepetitioner's case for discrimination against him by the 1 st respondentis heavily based on this second test. Firstly, the petitioner's case isthat he should not have been required to sit for a written examinationfor recruitment as a Cadet Flight Engineer because he had thenecessary academic qualifications for such a post. Secondly thepetitioner states that the paper contained 63 questions to beanswered in 78 minutes. The petitioner has further stated that "it wasa totally unfair paper and set for the purpose of belittling thequalifications possessed by the petitioner and intended to cover up themistake made in requiring the petitioner to sit-for the Cadet Pilotspaper earlier. The petitioner has become aware that it was the 3rdrespondent, who had set the paper and was also the invigilator at thetest". The result of this examination was not conveyed to thepetitioner, and the petitioner wrote to the 2nd respondent inquiringabout the results of the examination and complaining about the type ofthe paper set by his letter dated 10.11.86 (P10). To this letter (P10)the 2nd respondent replied by his letter dated 28.3.86 (P11) that theexamination comprised 53 questions and not 63 as stated by thepetitioner, and the time given was 75 minutes, i.e. one minute andthirty seconds for each question, and further an additional 5 minuteswas granted to the petitioner on his application. The petitioner wasalso informed by (P11) that he had got only 39% of the marks and ifmarks were deducted for the mistakes the aggregate marks wouldhave been 24%. Further the 2nd respondent by letter of 28th March,1986 (P11) informed the petitioner that "Air Lanka cannot offer youemployment". The examination for the petitioner held on 13.1.86 hasbecome a very contentious matter, and a good portion of the 3rdrespondent's affidavit and the counter affidavits of the petitioner andthe 3rd respondent deal with this contentious matter.
J54Sri Lanka Law Reports[1987] 2 SriL.R
The 3rd respondent in his affidavit dated 5.6.86 has affirmed thatnotwithstanding the petitioner's poor performance at the firstexamination for Cadet Pilots held on 6.12.85 it was decided tosubject him to a second test pertaining solely to the knowledge thatshould be possessed by an applicant for appointment as a Cadet FlightEngineer". The 3rd respondent has also affirmed that the papercontained 53 not 63 questions to be answered in 75 minutes, andfurther that at the petitioner's request a further additional 5 minuteswere given to him. The questions set could have been answered witiiease within the time set as they were mainly multiple choicequestions, and the answers required no longer than 1 or 2 sentences.The 3rd respondent has produced the script of the petitioner marked(R4), and a copy of the paper set with model answers marked (R5J.The 3rd respondent has denied that it was an "unfair paper", and thatit was "set for the purpose of belittling the qualifications possessed bvthe petitioner, and intended to cover up for the mistake in requiring thepetitioner to sit for the Cadet Pilots paper earlier". The petitionerobtained only 39% of the maximum number of marks withoutdeductions for wrong answers on multiple choice questions. Theminimum number of pass marks was 70%.
The petitioner in the counter affidavit filed dated 13.6.86 conteststhe affirmations of the 3rd respondent regarding the paper set for thesecond examination held on 13.1.86, and also contests the answersgiven in the model answers marked (R5) with reference to someAmerican Publications. The 3rd respondent has denied knowledge ofthose publications and further stated that in any event, on the face ofthem, the Publications are not from an authoritative source. The 3rdrespondent admits the error in respect of one answer in the modelanswers (R5), and has stated that that error would not have materiallyaffected the total marks received by the petitioner at this test. In hiscounter affidavit the petitioner has reiterated that he had qualificationsas a Flight Engineer to be recruited as a Cadet Flight Engineer in AirLanka, and what he needed was only a short training, which isdescribed as a "Transitional Training" in order to operate as a FlightEngineer in the type of Aircraft operated by the 1 st respondent. The3rd respondent in his counter affidavit admits that the petitioner hadthe basic qualifications to be considered for selection for training as aCadet Flight Engineer. The 3rd respondent has contested thepetitioner's affirmation that what he required was only a "TransitionalTraining" and explained that the petitioner was not qualified to
SCRajaratne v. Air Lanka Ltd (Seneviratne. J.)155
undergo such 'Transitional Training'. In paragraph 6:1 of the counteraffidavit the 3rd respondent states – 'in terms of the normal practice
followed by Air Lanka Limited and by all other reputed*
International Air Lines. 'Transitional Training', which is also known as'Conversion Training", is the training given to Flight Engineers, whohave both completed their initial training on a particular type of aircraftand gained substantial experience operating 'Solo' as FlightEngineers, on such type of Aircraft, in order to qualify them tooperate as Flight Engineers on another type of aircraft'. In paragraph6:3 of the counter affidavit the 3rd respondent affirms as follows:'since the petitioner did not have any previous experience operating'Solo' as a Flight Engineer on any type of aircraft or Air Lines(International or otherwise) and had only 1.3 Flying Hours to his credit,he was not qualified to receive "Transitional Training". The 3rdrespondent has further affirmed that the Regulations of the FederalAviation Administration of U.S.A. for licensing crew members of an aircraft had no application whatsoever to the 1st respondent Companyas the said Company was bound by the Air Navigation Act of SriLanka, and the Regulations made thereunder.
The petitioner's case of discrimination is that while his application,that of an applicant qualified as a Flight Engineer in respect of Boeing727, and one who needed only a short "Transitional Training' waspending, one Aruna Wijesinghe, who has had a training in AirLanka Limited as a Ground Engineer was recruited to a post of CadetFlight Engineer in August. 1985. The acts of discrimination alleged bythe petitioner are as follows:
In March. 1984 the petitioner made an application for a post ofFlight Engineer, which application has been considered as onefor Cadet Flight Engineer, and while that application waspending Aruna Wijesinghe an Apprentice Aircraft GroundEngineer in Air Lanka Limited was selected for the post of CadetFlight Engineer in August. 1984. Arising from this the petitionerhas made three points: 1
(1)That Aruna Wijesinghe did not possess a Flight Engineer'sLicence with a typerating (a technical term defined in theRegulation 3 made under the Air Navigation Act 15 of1950).
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Sri Lanka Law Reports
[1987] 2 Sri LR.
That Aruna Wijesinghe did not sit for a Flight Engineer'sExamination.
What is meant seems to be one held by Air Lanka.Limited; as will be shown later, this statement No. 2above is an error,
that with the qualifications of the petitioner only a shortterm training course, under Air Lanka would have beennecessary for the petitioner to extend his Flight EngineersLicence in respect of the type of Aircraft operated byAir Lanka.
I have set out above the allegations of discrimination made by thepetitioner in paragraph 17 of his affidavit. In course of the argumentthe learned counsel for the petitioner developed the following furthergrounds of discrimination. The arbitrary selection of Aruna Wijesingheindicates unfettered discretion of Air Lanka Limited, to selectpersonnel which was a negation of equal rights. The petitioner's caseis that these acts of discrimination brought the case of the petitionerwithin the terms of Article 12 (1) of the Constitution, which is asfollows:-‘‘All persons are equal before the Law and are entitled to theequal protection of the law”. The petitioner's case is that Air LankaLimited is an "organ of Government". He has made this applicationunder Article 17 of the Constitution as his. fundamental rights underArticle 12 (1) of the Constitution have been infringed by theexecutive or administrative action of Air Lanka Ltd. an organ of theGovernment. I
I will now deal with the reply of the 1 st respondent to this allegationof discrimination made by the petitioner in respect of the appointmentof Aruna Wijesinghe.' One of the main acts of the discriminationalleged is factually incorrect. That is the allegation that ArunaWijesinghe was recruited without a test. Perhaps.the petitioner wasnot aware that a test was held for Aruna Wijesinghe until the 3rdrespondent filed his affidavit. The 3rd respondent has affirmed that awritten examination was held for Aruna Wijesinghe before he wasconsidered for appointment as a Cadet Flight Engineer, and hasproduced 3 answer scripts of Wijesinghe, (R3A), (R6A) and (R6B),and has affirmed that Wijesinghe faired excellently and obtained 82%in each paper.
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The 3rd respondent has affirmed to the special circumstancesunder which Aruna Wijesinghe came to be appointed as Cadet FlightEngineer in August 1984. In mid 1984 the 1st respondent hadappointed 8 Cadet Pilots. These Cadet Pilots had completed theirGround School Training Course and Cockpit Procedure TrainingCourse successfully, and Lockheed 1011 Simulators had been,reserved in Hongkong for the purpose of imparting to these Cadetstheir 'Simulator Training' in aeronautical terminology. A 'Simulator' isa 'Computer Controlled Machine, which is almost identical to theCockpit of the relevant type of aircraft and simulates almost exactlythe said type of aircraft in flight'. One of the Cadet PilotsHatharasinghe left the services of the 1st respondent havingcompleted the Courses of training mentioned above, but before thecommencement of simulator training. As such the 1st respondentwas at that time in urgent need of a Second Officer for Lockheed1011 Aircraft. The 3rd respondent has affirmed that Cadet Pilotsemployed by ihe 1st respondent were trained for appointment asSecond Officers on Lockheed 1011 Aircraft. The duties andfunctions of such Second Officers are identical to those of FlightEngineers. The 3rd respondent has affirmed that Aruna Wijesinghehad been appointed as an Apprentice Air Craft Maintenance Engineeron 6.2.1980. and had been in training up to March 1984, and hadalready completed successfully a course of Ground School Trainingrelating to Lockheed 1011 Aircraft. The said Ground School TrainingCourse successfully completed by Aruna Wijesinghe. was a Course forAircraft Maintenance Engineers and was consequently a more,detailed and comprehensive Course than the Ground School TrainingCourse designed for Cadet Pilots and Cadet Flight Engineers.
Aruna Wijesinghe had submitted an application dated 10.7.84(X-IV) for the post of Flight Engineer. Para 3: of this application (X-IV)sets our among the qualifications of Aruna Wijesinghe that he has'successfully completed Civil Aviation Authority (U.K.) Basic TechnicalExamination for Flight Engineers Licence (including Air Law andWeight and Balance)'. This statement is certified by the Certificatedated 7th September 1983 from Civil Aviation Authority (U.K.)document (Y3). The papers filed show that Aruna Wijesinghe hadacquired some qualifications as a Flight Engineer. I must state that thepetitioner has been taken unawares by these documents, becausethese documents including Aruna Wijesinghe's application for post ofFlight Engineer were filed in the course of the hearing. I have already
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referred to two such documents, the application dated 10.7.84 (X4)and Certificate dated 7th September 1983 (Y3). I now refer toanother document dated 24.5.84 from the Civil Aviation Authority(U.K.)-(Y1), the results of the Flight Crew Technical Examination,which states that he has passed in the following subjects-LoadAviation Law (Flight Engineers) Part II. The 1st respondent has alsoproduced a letter received by Aruna Wijesinghe from the Civil AviationAuthority, (U.K.) dated 25.4.83 stating that he has qualified himselffor entry to the Flight Engineers Licence Technical Examination.Ultimately the 3rd respondent has affirmed that although thepetitioner had already tendered an application for appointment as aFlight Engineer, at the time Aruna Wijesinghe was appointed a CadetFlight Engineer to fill the vacancy created by the resignation of oneHatharasinghe, the petitioner could not have even been considered forappointment to the said vacancy, because, at that time, the 1 strespondent required a Cadet Second Officer or Cadet Flight Engineerto take the place on the Simulator Training Course, of the saidHatharasinghe who had resigned, and the petitioner was not qualifiedto do so, while Aruna Wijesinghe was.
Thus, it is clear that the 1 st respondent has taken up two positionsas to why the petitioner was not selected as a Cadet Flight Engineer. Imust state that one material point that has to be taken into account, isthat Air Lanka Limited did not call for any applications for post of CadetFlight Engineers. If that was done this Court would have had the 1 strespondent's criteria for selection of Cadet Flight Engineers and thecompeting claims of the petitioner and Aruna Wijesinghe could havebeen judged on that basis. The above observation is clarified by theNotice (P8) of 16th September, 1983 calling for applications forvacancies for Cadet Flight Pilots, which Notice (P8) gives the basicqualifications required. In this instance the problem for the petitionerhas arisen by the fact that no vacancy was advertised setting ouf thenecessary qualifications and the petitioner quite understandably as ayoung man qualified as a Flight Engineer with a desire to take to Flyingand a youngman's dream of being a member of the Aircraft Crew ofAir Lanka Limited, in his enthusiasm, applied for a pest of FlightEngineer in Air Lanka Limited. The 3rd respondent in the affidavit hasexplained that up to this time Air Lanka had not called forapplications for posts of Cadet Flight Engineers or even FlightEngineers. The mode of appointment has been as follows. The 3rdrespondent has affirmed that at the inception the 1st respondent's
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Company recruited as Flight Engineers fully qualified and experiencedFlight Engineers from the former Air Ceylon and from foreign Air Lines.It also recruited as Cadet Flight Engineers the former employees of AirCeylon who had the basic qualifications to be Flight Engineers, andwho would have been thrown out of employment with the liquidationof Air Ceylon, had they not been recruited by the 1 st respondent.There was no need to hold written examinations for the said CadetFlight Engineers as their personal files indicated their training. I must atthis stage state that the 1st respondent has also explained why in1984 the 1 st respondent for the first time decided to hold writtenexaminations. The 1 st respondent had taken a batch for training asCadet Pilots without a written examination and found that suchtrainees proved to be unsatisfactory and had to be discontinued. Thisis borne out by the advertisement (P8) of 15.9.85 calling forapplications for Cadet Pilots, which states "Candidates will be requiredto pass a written and flying test to prove their ability". In fact theRegulations framed under the Air Navigation Act No. 15 of 1950 forextension, of Flight Engineers Licence (Regulation 56(6)) provide inRegulation 65 that the applicants will undergo a test for aeronauticalknowledge, experience and skill practical test. Schedule 1 Regulation3:2:5 Flight Engineers provides that "an applicant for extension
of Air Craft rating of a licenceat the discretion of the Director
would be required to undergo all or any part of the technicalexamination". Further the 3rd respondent has affirmed that there wasno rule or law which set out the criteria to be followed and themethods to be adopted in selecting personnel-Cadet Pilots or CadetFlight Engineers. The 1 st respondent had a right to lay down its owncriteria for and methods of selection, and was the sole judge of thesuitability or otherwise of any candidate for appointment as a cadetPilot or Cadet Flight Engineer in its services. The 1 st respondent.oweda duty to its passengers and all who sought its services to ensure thatits Aircraft are operated by highly skilled and competent personnel.The 1st respondent was under a necessary duty to exercise thegreatest care and caution in the selection of personnel to operate itsAircraft as Pilots and Flight Engineers. Ultimately, the 3rd respondenthas affirmed that the petitioner did not have the necessaryqualifications for appointment as a Flight Engineer or Cadet Pilot.
As for the technical aspects of the matters that are in dispute in thisapplication, i.e. the nature of the papers set for the secondexamination for which the petitioner sat, and the technical aspect Of
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the competence, that is required, the most competent person tospeak to these matters in respect of this application is the 1strespondent, who has-placed these matters before Court through the3rd respondent. As against the opinion of the 1st and 3rdrespondents is that of the petitioner as averred in his petition andcounter affidavit. There is no other independent view placed beforethis Court by the petitioner. Undoubtedly it is the duty of and- theburden is on the petitioner to prove his case of discrimination by the1st respondent. There has been no third independent view placedbefore this Court. In this situation the court has to act on the opinionexpressed by the 1st respondent through its agent the 3rd respondenta highly qualified, competent and experienced person who canexpress opinions on the technical matters in issue.
On the facts placed before this Court I cannot hold that the 1strespondent has acted in a discriminatory or unjust manner in notappointing the petitioner as a Cadet Flight Engineer in preference tothe said Aruna Wijesinghe. As such the case of discrimination andunjust or unequal treatment made by the petitioner is not factuallyproved and-fails. The above finding on facts is sufficient to concludethis application. However, I propose to record the legal issues raised,and the submissions made by learned Counsel for both parties as thesubmissions were both far reaching and illuminating. Counsel for thePetitioner submitted that this Court should widen the frontiers of thelaw pertaining to the interpretation of Articles 4(d) and 17 of theConstitution. Learned President's Counsel for the Respondents invitedthe Court to reconsider the basis of the decisions in the leading caseson this subject.
The learned Counsel for the Petitioner submitted that the main legalissue arising in this application, was whether Air Lanka Limited was anorgan of Government, and whether the discriminatory action of the1 st respondent Jayasuriya was executive or administrative action. Thedifficulty arises when, as in this instance, actions of persons who arenot strictly State Officers are in issue, that is whether such actions arestate actions or individual actions. Further, the learned counsel for thePetitioner submitted that so far this Court has considered the Articlesof the Constitution pertaining to fundamental rights only in respect ofbodies which are statutory bodies. Such leading cases are: Wijesinghev. insurance Corporation and another (2) Chandrasena and two othersv. National Paper Corporation and two others (13) heard together with
above, Wijeratne and another v. The People's Bank and another
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(Divisional Bench of Five Judges), Gunaratne v. People's Bank (5)(Divisional Bench of Five Judges), which reconsidered the position inthe earlier People's Bank case and distinguished and explained thatcase. (Pages 354-356), Perera v. University Grants Commission (1),Roberts v. Kandy Municipal Council. (6).
Learned counsel for the petitioner submitted that this was the firstoccasion this Court has to decide whether an incorporated body – aCompany performing commercial functions in this instance. Air LankaLtd., was an organ of government. It is in this context that the learnedcounsel for the petitioner urged this Court to consider the extension ofthe frontiers of the law to cover such bodies as Air Lanka Ltd. Insupport of this theory to extend the law to cover such bodies, thelearned counsel for the petitioner relied heavily on AmericanAuthorities, both texts and decided cases. Learned counsel referred toseveral texts – Civil Liberties and the Constitution by Paul G. Kauper(Page 155) – which is as follows: – 'We now consider the secondcategory of situations where we have actions taken by persons or.associations or organisations that may be regarded as private incharacter but whose relationship to State by reference to specialprivileges enjoyed, property used, or position in the State's regulatoryscheme, may raise questions as to whether their actions are to beidentified with the State for the purpose of the Fourteenth Amendment
Restrictions This category embraces several types of
enterprise which serve public purposes but are not publicly owned oroperated"; Civil Liberties under the Constitution by M. GlennAbernathy, (Page 78) onwards. Cases on Constitutional Law byBarret, (Page 12) – Fourteenth Amendment to the Constitution,Learned Counsel for the petitioner also relied on several Judicialdecisions in the States – Kerr v. Enoch Pratt Free Library (14), Marshv. Alabama (15). Learned counsel submitted that on the authoritiescited above, in the States-
Incorporated bodies,
Private Groups of persons, incorporated or not have been heldto be State Bodies.
Learned counsel for the petitioner submitted that the real test,whether a body exercises State or Government power depends not onhow it was created but as to why it was created and its functions. For.this proposition learned counsel cited the case of – Ajay Hasia, v.Khalid Mujib Schravardi and others. (9). In considering the decisions ofthe Supreme Court of India, it has to be noted and borne in mind that
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our Constitution has not defined the term "organ of government" inArticle 4(d), and the term "executive and administration action" inArticle 17 of the Constitution, whereas the Constitution of India Part111 Fundamental Rights Articles 12-25 refers to State Action, andArticle 14 has defined the term "State" widely – "In this part unless thecontext otherwise requires "the State" includes the Government andParliament of India and the Government and the Legislature of each ofthe States and all Local or other authorities within the territory of Indiaor under the control of the Government of India".
Learned counsel for the petitioner directed the attention of Court to'several provisions in the Memorandum and Articles of Association ofAir Lanka Ltd., a Company formed under the Companies Ordinance,which showed the involvement of the State/Government, inter alia,the contribution of 60% of the capital by the State, appointment of theFirst Directors by the Government, and the Government to have themajority of Directors nominated, appointment of the Chairman by theGovernment, and such other features. Learned counsel for thepetitioner submitted that Air Navigation was a State subject and aState function. In the Company Air Lanka Ltd., the government hasemployed a device to perform the functions of the government. AirLanka Ltd., was an instrument of government performing airlinebusiness. "A Company" was only a facade. In fact it is the governmentwhich controls Air Lanka Ltd. On these submissions learned counselfor the petitioner urged the Court to consider Air Lanka Ltd., as anorgan of government in terms of Article 4(d) of the Constitution.
The respondents to this Application have raised a preliminaryobjection to the effect that the 1st respondent Air Lanka Ltd., was not'an organ of the State performing governmental functions, and thatthe acts of the 2nd and 3rd respondents do not constitute executiveor administrative action, and are not justiciable in terms of Article 126of the Constitution"- Para. 14:4 of the affidavit of the 3rdrespondent. The submission made by the learned President's counselfor the respondents as to which kind of body was "an organ ofgovernment" was widely divergent from that of the learned counsel forthe petitioner. The learned President's counsel submitted that the 1 strespondent Air Lanka Ltd., was a commercial body formed under theCompanies Ordinance, the Articles of the Company bind the internaladministration of the Company and the fact that the governmentcontributed capital, appointed Directors as such did not make it anorgan of government. For a body to be an organ of Government/State,
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it must be a body, created by statute to which some attribute ofState/Sovereign power has been conferred by statute. The Air LankaLtd., is a Company. No State power has been conferred on it. Thissubmission that for a body to come within the terms of Articles 4(d)and 17 of the Constitution, it must be created by statute, and must beconferred with some state of sovereign power went beyond thedecisions of this Court cited earlier, and as to what are the attributesor tests of State Power. This Court has used as tests the functionaltest and the 'government controlled' test. Learned President scounsel submitted in relation to the Supreme Court decision in. Wijetunge v. Insurance Corporation and another (referred to above)that the functional test applied in the case was not a safe test, butconceded that the conclusion in the case was correct. LearnedPresident's counsel got support for this thesis from certain leadingIndian cases .-^Rajasthan State Electricity Board. Appellant v. Mohanlaland others, respondents (7) Shah, J. (Pages 1862-1864), HeavyEngineering Mazdoor Union v. State of Bihar (16), Sukhdev Singh andothers. Appellants v. Bhagatram and another, respondents (8),judgment of Aligirisamy, J., Somprakash Rekhi. Pet. v. Union of Indiaand another, respondents (10). Learned President's counsel for. respondents summed up his submissions as follows – that the issue offundamental rights arises in respect of that kind of body which sharesState power, and can infringe on public rights. i
i have made a summary and a record of the submissions made asthey were illuminating and went away from the decided cases, andhad a new look at Articles 4 (d) and 17 of the Constitution. But in view.of my finding in respect of the factual position re the allegation ofdiscrimination by the petitioner, it is unnecessary for me to make aruling on the above farreaching submissions made by the learnedcounsel for the petitioner and the respondents. I regret to take thiscourse of action. There are precedents of this Court on this matter,which in these circumstances, I will follow. The Application-GaminiSamarasinghe v. Bank of Ceylon and another (17)- was one madeunder Article 12 (1 )* of the Constitution-right to equality. Whiledenying the allegations made by the petitioner the respondent Bankhad also taken the preliminary objection "that the 1 st respondent isnot an organ of the government, nor does it exercise the executive oradministrative power of the State". This Court per Weeraratne, J. heldthat it was satisfied that the respondent Bank had not violated Article12 (1) of the Constitution, and further held that due to this finding, the
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Court does not express an opinion on the validity of the objections.The Application of Gunasena Thenabadu v. University of Colombo andothers-(18) was one under Articles 12 (1) and 12 (2) of theConstitution pertaining .to the denial of equality before theLaw-language rights. This Court per Samarakoon, C.j. held that thepetitioner has failed to prove the allegation made in the petition againstthe respondents. Having come to this conclusion the Court furtherheld as follows:- "Counsel for the respondents took up a preliminaryobjection that the allegations in the pleadings of the petitioner did notdisclose infringement of a fundamental right of the petitioner byexecutive or administration action", and that the action of therespondents was not "an act of executive or administrative action bysome organ of government". Having made this observation this Courtruled as follows:- "We heard interesting arguments on this point by'both counsel, but we do not propose,to make any comments on thispoint because of the view that we have formed on the other objectionsof counsel for respondents". In the Application-Wijetunge v.Insurance Corporation and another (referred to above)-applicationmade under Articles 14 (1) (a) and 14(1) (d) of the Constitution, therespondents took up the preliminary objection that the allegedviolation of these rights by the Insurance Corporation did not amountto infringement by executive or administrative action as it was not anorgan of the government. In the Application decided on the same dayChandrasena and two others v. National Paper'Corporation and twoothers (supra) application was made under Article 12 (2) of theConstitution. In this Application also preliminary objection had beentaken that that action of the respondents did not amount to executiveor administrative action as it was not an organ of government.Sharvananda, A.C.J., who delivered the judgments upheld thepreliminary objections in both these Applications, and further held,that as such it was not necessary to go into the factual merits of thepetitioner's complaint.
I have followed these precedents of this Court. The Application istherefore refused, and in the circumstances of this case it is refusedwithout costs. The Application is dismissed. No costs.
After I had formulated my judgment I received the judgment of mybrother Atukorale, J. I do not agree with the judgment.
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H. A. G. de Silva, J.
I have had the advantage of reading the judgments of both mybrothers, Atukorale, J. and Seneviratne, J. I agree with the reasonsand conclusions given in the judgment of Atukorale, J. on bothmatters that arise for decision in this case. I therefore agree with theorder he has made allowing the Application with costs and awardingthe sum stated by him as compensation to the petitioner.
Application allowed.
Compensation awarded.